UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (date of earliest event
reported):
July 28, 2015
Jamba, Inc.
(Exact name of registrant as specified
in its charter)
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| Delaware |
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001-32552 |
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20-2122262 |
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(State or other jurisdiction
of incorporation) |
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(Commission
File No.) |
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(I.R.S. Employer
Identification No.) |
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6475 Christie Avenue, Suite 150, Emeryville,
California 94608
(Address of principal executive offices)
Registrant's telephone number, including
area code:
(510) 596-0100
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ |
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Explanatory Note
As previously disclosed in its Current Report on Form 8-K filed
with the U.S. Securities and Exchange Commission on August 3, 2015 (the “Prior Report”), Jamba, Inc.
(the “Company”) completed the refranchising of a group of Company-owned stores located in Northern California
as part of its refranchising initiative. This Amendment to the Prior Report is being filed for the purpose of correcting certain
clerical errors in the unaudited pro forma condensed statements of operations of the Company for the 13 week period ended March
31, 2015 furnished as part of Exhibit 99.1 to the Prior Report and providing additional supplemental information regarding the
26 week period ended June 30, 2015. No other changes have been made to the Prior Report.
Item 9.01. Financial Statements and
Exhibits(b)
(b)
Pro Forma Financial Information
The unaudited pro forma condensed consolidated
financial statements of the Company, which reflect the disposition described in Item 2.01 of the Prior Report and all other prior
disposals under the Company’s refranchising initiative, are furnished as Exhibit 99.1 to this Current Report on Form 8-K
and are incorporated by reference herein.
(d) Exhibits
99.1 Unaudited pro forma condensed consolidated
financial statements of the Company.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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JAMBA, INC. |
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| Date: August 6, 2015 |
By: |
/s/ Karen L. Luey |
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Karen L. Luey
Chief Financial Officer, Chief Administrative Officer, Executive
Vice President and Secretary |
JAMBA INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands)
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PRO
FORMA ADJUSTMENTS |
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|
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|
| |
|
Reported
13 week period ended
March 31, |
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April
Disposal |
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April
Disposal |
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May |
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June
Disposal |
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June
Disposal |
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July
Disposal |
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July
Disposal |
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Other |
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Total |
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Pro
Forma 13 week period ended
March 31, |
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2015 |
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|
1 |
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2 |
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Disposal |
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|
1 |
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2 |
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|
1 |
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|
2 |
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|
Disposals |
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|
Adjustments |
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2015 |
|
|
| Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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| Company Stores |
|
$ |
47,728 |
|
|
$ |
(2,350 |
) |
|
$ |
(1,644 |
) |
|
$ |
(1,737 |
) |
|
$ |
(1,681 |
) |
|
$ |
(1,550 |
) |
|
$ |
(1,774 |
) |
|
$ |
(13,651 |
) |
|
$ |
(814 |
) |
|
|
(25,202 |
) |
|
A |
|
|
$ |
22,526 |
|
|
| Franchise and other revenue |
|
|
4,776 |
|
|
|
129 |
|
|
|
90 |
|
|
|
96 |
|
|
|
92 |
|
|
|
85 |
|
|
|
92 |
|
|
|
751 |
|
|
|
45 |
|
|
|
1,381 |
|
|
B |
|
|
|
6,157 |
|
|
| Total revenue |
|
|
52,504 |
|
|
|
(2,221 |
) |
|
|
(1,554 |
) |
|
|
(1,641 |
) |
|
|
(1,589 |
) |
|
|
(1,465 |
) |
|
|
(1,682 |
) |
|
|
(12,900 |
) |
|
|
(769 |
) |
|
|
(23,821 |
) |
|
|
|
|
|
28,683 |
|
|
| Costs and operating expenses (income): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cost of sales |
|
|
12,407 |
|
|
|
(585 |
) |
|
|
(428 |
) |
|
|
(428 |
) |
|
|
(431 |
) |
|
|
(412 |
) |
|
$ |
(469 |
) |
|
$ |
(3,352 |
) |
|
|
(216 |
) |
|
|
(6,321 |
) |
|
C |
|
|
|
6,086 |
|
|
| Labor |
|
|
16,088 |
|
|
|
(822 |
) |
|
|
(477 |
) |
|
|
(557 |
) |
|
|
(518 |
) |
|
|
(498 |
) |
|
$ |
(530 |
) |
|
$ |
(4,358 |
) |
|
|
(288 |
) |
|
|
(8,048 |
) |
|
C |
|
|
|
8,040 |
|
|
| Occupancy |
|
|
6,835 |
|
|
|
(301 |
) |
|
|
(207 |
) |
|
|
(222 |
) |
|
|
(211 |
) |
|
|
(213 |
) |
|
$ |
(252 |
) |
|
$ |
(1,555 |
) |
|
|
(58 |
) |
|
|
(3,019 |
) |
|
C |
|
|
|
3,816 |
|
|
| Store operating |
|
|
8,034 |
|
|
|
(376 |
) |
|
|
(224 |
) |
|
|
(244 |
) |
|
|
(239 |
) |
|
|
(216 |
) |
|
$ |
(244 |
) |
|
$ |
(1,891 |
) |
|
|
(76 |
) |
|
|
(3,510 |
) |
|
C |
|
|
|
4,524 |
|
|
| Depreciation and amortization |
|
|
1,873 |
|
|
|
(51 |
) |
|
|
(32 |
) |
|
|
(68 |
) |
|
|
(55 |
) |
|
|
(37 |
) |
|
$ |
(45 |
) |
|
$ |
- |
|
|
|
(81 |
) |
|
|
(368 |
) |
|
C |
|
|
|
1,505 |
|
|
| General and administrative |
|
|
8,963 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
8,963 |
|
|
| Other operating, net |
|
|
(28 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,924 |
|
|
|
1,924 |
|
|
D |
|
|
|
1,896 |
|
|
| Total costs and operating expenses |
|
|
54,172 |
|
|
|
(2,135 |
) |
|
|
(1,368 |
) |
|
|
(1,519 |
) |
|
|
(1,454 |
) |
|
|
(1,375 |
) |
|
|
(1,540 |
) |
|
|
(11,157 |
) |
|
|
1,205 |
|
|
|
(19,343 |
) |
|
|
|
|
|
34,829 |
|
|
| Loss from operations |
|
|
(1,668 |
) |
|
|
(86 |
) |
|
|
(186 |
) |
|
|
(122 |
) |
|
|
(135 |
) |
|
|
(90 |
) |
|
|
(142 |
) |
|
|
(1,744 |
) |
|
|
(1,974 |
) |
|
|
(4,478 |
) |
|
|
|
|
|
(6,146 |
) |
|
| Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest income |
|
|
15 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
15 |
|
|
| Interest expense |
|
|
(41 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
(41 |
) |
|
| Total other expense, net |
|
|
(26 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
(26 |
) |
|
| Loss before income taxes |
|
|
(1,694 |
) |
|
|
(86 |
) |
|
|
(186 |
) |
|
|
(122 |
) |
|
|
(135 |
) |
|
|
(90 |
) |
|
|
(142 |
) |
|
|
(1,744 |
) |
|
|
(1,974 |
) |
|
|
(4,478 |
) |
|
|
|
|
|
(6,198 |
) |
|
| Income tax expense |
|
|
(26 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
(26 |
) |
|
| Net loss |
|
|
(1,720 |
) |
|
|
(86 |
) |
|
|
(186 |
) |
|
|
(122 |
) |
|
|
(135 |
) |
|
|
(90 |
) |
|
|
(142 |
) |
|
|
(1,744 |
) |
|
|
(1,974 |
) |
|
|
(4,478 |
) |
|
|
|
|
|
(6,198 |
) |
|
| Less: Net income attributable to
noncontrolling interest |
|
|
31 |
|
|
|
- |
|
|
|
(31 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(31 |
) |
|
E |
|
|
|
- |
|
|
| Net loss attributable to common stockholders |
|
$ |
(1,751 |
) |
|
$ |
(86 |
) |
|
$ |
(155 |
) |
|
$ |
(122 |
) |
|
$ |
(135 |
) |
|
$ |
(90 |
) |
|
$ |
(142 |
) |
|
$ |
(1,744 |
) |
|
$ |
(1,974 |
) |
|
$ |
(4,447 |
) |
|
|
|
|
$ |
(6,198 |
) |
|
Jamba, Inc.
Notes to Unaudited Pro Forma Condensed Consolidated Financial
Statements
March 31, 2015
| 1. | Description of Refranchising Transactions |
Beginning in January, 2015, Jamba
Juice Company, a California corporation and wholly-owned subsidiary of Jamba, Inc. (the “Company”) began refranchising
Company-owned stores located in the San Francisco Bay Area and Southern California as part of the Company’s refranchising
initiative in multiple transactions.
April Disposal 1
In connection with the first
refranchising transaction, the Company transferred to M5 Partners, Inc. all machinery, equipment, computer hardware
(including point of sale equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all
goodwill associated with the stores for a purchase price of $1,850,000. M5 Partners, Inc. agreed to enter into the Company’s standard franchise agreement with a
ten-year term in connection with entering into the transaction.
April Disposal 2
In another refranchising transaction
completed on April 28, 2015, the Company sold its 88% membership interest in Jamba Juice Southern California LLC (“JJSC”)
to Strategic Marketing Sciences, Inc., its minority partner in the joint venture. JJSC was formed to operate a group of stores
in Southern California. The purchase price for the membership interest was $3,000,000 plus payment for all marketable inventory
and cash on hand at each of the stores. Strategic Marketing Sciences, Inc. agreed to enter into the Company’s standard franchise
agreement with a ten-year term in connection with entering into the transaction.
May Disposal
On May 19, 2015, the Company
completed the refranchising of a group of Company-owned stores located in the San Francisco Bay Area. In connection with the
refranchising transaction, the Company transferred to Blended Star NorCal, Inc. all machinery, equipment, computer hardware
(including point of sale equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all
goodwill associated with the stores for a purchase price of $2,500,000 plus payment for all marketable inventory and cash on
hand at each of the stores. Blended Star NorCal, Inc. agreed to enter into the Company’s standard franchise agreement
with a ten-year term in connection with entering into the transaction.
June Disposal 1
On June 9, 2015, the Company completed
the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative. In
connection with the refranchising transaction, the Company transferred to J’s Juice Masters, Inc. all machinery, equipment,
computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, all
marketable inventory and all goodwill associated with the stores for a purchase price of $2,100,000 plus payment for cash on hand
at each of the stores. J’s Juice Masters, Inc. agreed to enter into the Company’s standard franchise agreement with
a ten-year term in connection with entering into the transaction.
June Disposal 2
On June 30, 2015, the Company
completed the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative.
In connection with the refranchising transaction, the Company transferred to CMCS 2 Juice, LP and CMCS 3 Juice, LP all machinery,
equipment, computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property,
all marketable inventory and all goodwill associated with the stores for a purchase price of $1,800,000 plus payment for cash on
hand at each of the stores. Payment of the purchase price was comprised of $540,000 in cash and two promissory notes of $542,079
and $717,921, both with an interest rate of four and one-quarter percent (4.25%) per annum and maturity dates of July 30, 2015.
CMCS 2 Juice, LP and CMCS 3 Juice, LP agreed to enter into the Company’s standard franchise agreement with a ten-year term
in connection with entering into the transaction.
July Disposal 1
On July 7, 2015, the Company completed
the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative. In
connection with the refranchising transaction, the Company transferred to one owner operating five separate entities - Brea Juice
Company, LLC, Fresh Juice Development, LLC, Grab N Go Juice, LLC, Juice To Go, LLC and LA Juice Company, LLC - all machinery, equipment,
computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, all
marketable inventory and all goodwill associated with the stores for a purchase price of $6,600,030 plus payment of $30,000 for
cash on hand at each of the stores. Brea Juice Company, LLC, Fresh Juice Development, LLC, Grab N Go Juice, LLC, Juice To Go, LLC
and LA Juice Company, LLC, agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection
with entering into the transaction.
July Disposal 2
On July 28, 2015, the Company
completed the refranchising of a group of Company-owned stores located in Northern and Southern California as part of its refranchising
initiative. In connection with the refranchising transaction, the Company transferred to Vitaligent, LLC through its two wholly
owned subsidiaries, Vitaligent-East Bay, LLC and Vitaligent-NorCal, LLC, all machinery, equipment, computer hardware (including
point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, cash on hand at each of the stores,
all marketable inventory and all goodwill associated with the stores for a purchase price of $25,000,000. The purchase price comprises
a $23,000,000 cash payment and a promissory note for $2,000,000 that matures on February 1, 2021. The promissory note bears basic
interest at a rate of 3% per annum, plus payment-in-kind interest at a rate of 5.5% per annum. The payment-in-kind interest compounds
quarterly beginning October 28, 2015. In addition to a $50,000 escrow account at closing for store repairs/upgrades, there is a
reduction in gain for contingent payables of $694,000 for designated repairs and fixed asset additions. Vitaligent-East Bay, LLC
and Vitaligent-NorCal, LLC agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection
with entering into the transaction.
Other Disposals
In addition to the
transactions mentioned above, the Company entered into multiple individually immaterial agreements and refranchised a small
group of stores located in Southern California and in the San Francisco Bay Area during the 13 week periods ended March 31,
2015 and June 30, 2015. In connection with the refranchising transactions, the Company received aggregate proceeds of
$2,412,000 and the purchasers entered into the Company’s standard franchise agreements with ten-year terms in
connection with entering into the transactions.
The unaudited pro forma condensed consolidated
financial statements were prepared in accordance with GAAP and pursuant to U.S. Securities and Exchange Commission Regulation S-X
Article 11, and present the pro forma financial position and results of operations of the Company based upon the historical information
after giving effect to the disposal and adjustments described in the notes to the unaudited pro forma condensed consolidated financial
statements. The unaudited pro forma condensed consolidated balance sheet is presented as if the refranchising had occurred on March
31, 2015, and the unaudited pro forma condensed consolidated statement of operations for the 13 week period ended March 31, 2015
is presented as if the disposal had occurred on January 1, 2014 and carried forward through the 13 week period ended on March 31,
2015. As a result, pro forma adjustments for refranchising of the small group of stores completed during the 13 week period
ended March 31, 2015 were reflected in the unaudited pro forma condensed consolidated statement of operations only.
The unaudited pro forma condensed consolidated financial
information is presented for informational purposes only and is not indicative of the Company’s financial results or financial
position as if the transactions reflected herein had occurred, or been in effect during the pro forma periods. This unaudited
pro forma condensed consolidated financial information should not be viewed as indicative of the Company’s expected financial
results for future periods.
| 3. | Adjustments to Unaudited Pro Forma Condensed Consolidated
Statement of Operations |
A - Reflects the pro forma adjustments for the revenue
during the 13 week period ended March 31, 2015 from the stores sold to franchise partners.
B - Reflects the pro forma adjustments for estimated
royalty income that would have been earned had the stores been owned by franchisees for the 13 week period ended March 31, 2015.
C - Reflects the pro forma adjustments for the expenses
related to the stores sold to franchise partners.
D - Reflects the pro forma adjustments to remove
the effect of the gain on refranchising the small group of stores during the 13 week period ended March 31, 2015.
E - Reflects the pro forma adjustments to eliminate
the 12% noncontrolling interest in JJSC, since the owner of the noncontrolling interest is acquiring the remaining interest on
the JJSC stores.
| * | The Notes herein do not include Note 3 from the prior
Report since such note only relates to the unaudited pro forma condensed balance sheet which is not included herein. |
JAMBA INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands)
| |
|
|
PRO FORMA ADJUSTMENTS |
|
| |
|
|
Reported 26 week period ended June
30, |
|
|
|
April Disposal |
|
|
|
April Disposal |
|
|
|
May |
|
|
|
June Disposal |
|
|
|
June Disposal |
|
|
|
July Disposal |
|
|
|
July Disposal |
|
|
|
Other |
|
|
|
Total |
|
|
|
|
|
Pro Forma 26 week period ended
June 30, |
|
| |
|
|
2015 |
|
|
|
1 |
|
|
|
2 |
|
|
|
Disposal |
|
|
|
1 |
|
|
|
2 |
|
|
|
1 |
|
|
|
2 |
|
|
|
Disposals |
|
|
|
Adjustments |
|
|
|
|
|
2015 |
|
| Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Company Stores |
|
$ |
96,088 |
|
|
$ |
(3,131 |
) |
|
$ |
(2,161 |
) |
|
$ |
(2,736 |
) |
|
$ |
(2,937 |
) |
|
$ |
(3,119 |
) |
|
$ |
(7,952 |
) |
|
$ |
(29,859 |
) |
|
$ |
(978 |
) |
|
|
(52,872 |
) |
|
A |
|
$ |
43,216 |
|
| Franchise and other revenue |
|
|
10,542 |
|
|
|
172 |
|
|
|
119 |
|
|
|
150 |
|
|
|
162 |
|
|
|
172 |
|
|
|
437 |
|
|
|
1,642 |
|
|
|
54 |
|
|
|
2,908 |
|
|
B |
|
|
13,450 |
|
| Total revenue |
|
|
106,630 |
|
|
|
(2,958 |
) |
|
|
(2,042 |
) |
|
|
(2,585 |
) |
|
|
(2,776 |
) |
|
|
(2,947 |
) |
|
|
(7,515 |
) |
|
|
(28,217 |
) |
|
|
(925 |
) |
|
|
(49,964 |
) |
|
|
|
|
56,666 |
|
| Costs and operating expenses (income): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cost of sales |
|
|
23,881 |
|
|
|
(778 |
) |
|
|
(549 |
) |
|
|
(653 |
) |
|
|
(724 |
) |
|
|
(796 |
) |
|
$ |
(2,009 |
) |
|
$ |
(7,146 |
) |
|
|
(242 |
) |
|
|
(12,896 |
) |
|
C |
|
|
10,985 |
|
| Labor |
|
|
30,964 |
|
|
|
(1,119 |
) |
|
|
(637 |
) |
|
|
(892 |
) |
|
|
(940 |
) |
|
|
(1,015 |
) |
|
$ |
(2,450 |
) |
|
$ |
(8,999 |
) |
|
|
(337 |
) |
|
|
(16,390 |
) |
|
C |
|
|
14,574 |
|
| Occupancy |
|
|
12,966 |
|
|
|
(336 |
) |
|
|
(210 |
) |
|
|
(318 |
) |
|
|
(373 |
) |
|
|
(435 |
) |
|
$ |
(1,139 |
) |
|
$ |
(3,144 |
) |
|
|
(100 |
) |
|
|
(6,054 |
) |
|
C |
|
|
6,912 |
|
| Store operating |
|
|
16,093 |
|
|
|
(552 |
) |
|
|
(308 |
) |
|
|
(401 |
) |
|
|
(447 |
) |
|
|
(464 |
) |
|
$ |
(1,152 |
) |
|
$ |
(4,204 |
) |
|
|
(149 |
) |
|
|
(7,677 |
) |
|
C |
|
|
8,416 |
|
| Depreciation and amortization |
|
|
3,217 |
|
|
|
(122 |
) |
|
|
(32 |
) |
|
|
(70 |
) |
|
|
(99 |
) |
|
|
(60 |
) |
|
$ |
(288 |
) |
|
|
- |
|
|
|
(84 |
) |
|
|
(755 |
) |
|
C |
|
|
2,462 |
|
| General and administrative |
|
|
17,390 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
17,390 |
|
| (Gain) loss on disposal of assets |
|
|
(5,258 |
) |
|
|
(1,334 |
) |
|
|
2,519 |
|
|
|
618 |
|
|
|
826 |
|
|
|
766 |
|
|
|
- |
|
|
|
- |
|
|
|
1,975 |
|
|
|
5,370 |
|
|
D |
|
|
112 |
|
| Other operating, net |
|
|
2,584 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
2,584 |
|
| Total costs and operating expenses |
|
|
101,837 |
|
|
|
(4,241 |
) |
|
|
783 |
|
|
|
(1,716 |
) |
|
|
(1,757 |
) |
|
|
(2,004 |
) |
|
|
(7,039 |
) |
|
|
(23,492 |
) |
|
|
1,064 |
|
|
|
(38,402 |
) |
|
|
|
|
63,435 |
|
| Income (loss) from operations |
|
|
4,793 |
|
|
|
1,283 |
|
|
|
(2,825 |
) |
|
|
(869 |
) |
|
|
(1,018 |
) |
|
|
(943 |
) |
|
|
(476 |
) |
|
|
(4,724 |
) |
|
|
(1,988 |
) |
|
|
(11,562 |
) |
|
|
|
|
(6,769 |
) |
| Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest income |
|
|
29 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
29 |
|
| Interest expense |
|
|
(109 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
(109 |
) |
| Total other expense, net |
|
|
(80 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
(80 |
) |
| Income (loss) before income taxes |
|
|
4,713 |
|
|
|
1,283 |
|
|
|
(2,825 |
) |
|
|
(869 |
) |
|
|
(1,018 |
) |
|
|
(943 |
) |
|
|
(476 |
) |
|
|
(4,724 |
) |
|
|
(1,988 |
) |
|
|
(11,562 |
) |
|
|
|
|
(6,849 |
) |
| Income tax expense |
|
|
(83 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
(83 |
) |
| Net income (loss) |
|
|
4,630 |
|
|
|
1,283 |
|
|
|
(2,825 |
) |
|
|
(869 |
) |
|
|
(1,018 |
) |
|
|
(943 |
) |
|
|
(476 |
) |
|
|
(4,724 |
) |
|
|
(1,988 |
) |
|
|
(11,562 |
) |
|
|
|
|
(6,932 |
) |
| Less: Net income (loss) attributable to noncontrolling
interest |
|
|
52 |
|
|
|
- |
|
|
|
(52 |
) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(52 |
) |
|
E |
|
|
- |
|
| Net income (loss) attributable to common stockholders |
|
$ |
4,578 |
|
|
$ |
1,283 |
|
|
$ |
(2,773 |
) |
|
$ |
(869 |
) |
|
$ |
(1,018 |
) |
|
$ |
(943 |
) |
|
$ |
(476 |
) |
|
$ |
(4,724 |
) |
|
$ |
(1,988 |
) |
|
$ |
(11,510 |
) |
|
|
|
$ |
(6,932 |
) |
Jamba, Inc.
Notes to Unaudited Pro Forma Condensed Consolidated Financial
Statements
June 30, 2015
| 1. | Description of Refranchising Transactions |
Beginning in January, 2015, Jamba
Juice Company, a California corporation and wholly-owned subsidiary of Jamba, Inc. (the “Company”) began refranchising
Company-owned stores located in the San Francisco Bay Area and Southern California as part of the Company’s refranchising
initiative in multiple transactions.
April Disposal 1
In connection with the first
refranchising transaction, the Company transferred to M5 Partners, Inc. all machinery, equipment, computer hardware
(including point of sale equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all
goodwill associated with the stores for a purchase price of $1,850,000. M5 Partners, Inc. agreed to enter into the Company’s standard franchise agreement with a
ten-year term in connection with entering into the transaction.
April Disposal 2
In another refranchising transaction
completed on April 28, 2015, the Company sold its 88% membership interest in Jamba Juice Southern California LLC (“JJSC”)
to Strategic Marketing Sciences, Inc., its minority partner in the joint venture. JJSC was formed to operate a group of stores
in Southern California. The purchase price for the membership interest was $3,000,000 plus payment for all marketable inventory
and cash on hand at each of the stores. Strategic Marketing Sciences, Inc. agreed to enter into the Company’s standard franchise
agreement with a ten-year term in connection with entering into the transaction.
May Disposal
On May 19, 2015, the Company
completed the refranchising of a group of Company-owned stores located in the San Francisco Bay Area. In connection with the
refranchising transaction, the Company transferred to Blended Star NorCal, Inc. all machinery, equipment, computer hardware
(including point of sale equipment), furniture, fixtures, tools, signs, vehicles, other tangible personal property and all
goodwill associated with the stores for a purchase price of $2,500,000 plus payment for all marketable inventory and cash on
hand at each of the stores. Blended Star NorCal, Inc. agreed to enter into the Company’s standard franchise agreement
with a ten-year term in connection with entering into the transaction.
June Disposal 1
On June 9, 2015, the Company completed
the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative. In
connection with the refranchising transaction, the Company transferred to J’s Juice Masters, Inc. all machinery, equipment,
computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, all
marketable inventory and all goodwill associated with the stores for a purchase price of $2,100,000 plus payment for cash on hand
at each of the stores. J’s Juice Masters, Inc. agreed to enter into the Company’s standard franchise agreement with
a ten-year term in connection with entering into the transaction.
June Disposal 2
On June 30, 2015, the Company
completed the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative.
In connection with the refranchising transaction, the Company transferred to CMCS 2 Juice, LP and CMCS 3 Juice, LP all machinery,
equipment, computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property,
all marketable inventory and all goodwill associated with the stores for a purchase price of $1,800,000 plus payment for cash on
hand at each of the stores. Payment of the purchase price was comprised of $540,000 in cash and two promissory notes of $542,079
and $717,921, both with an interest rate of four and one-quarter percent (4.25%) per annum and maturity dates of July 30, 2015.
CMCS 2 Juice, LP and CMCS 3 Juice, LP agreed to enter into the Company’s standard franchise agreement with a ten-year term
in connection with entering into the transaction.
July Disposal 1
On July 7, 2015, the Company completed
the refranchising of a group of Company-owned stores located in Southern California as part of its refranchising initiative. In
connection with the refranchising transaction, the Company transferred to one owner operating five separate entities - Brea Juice
Company, LLC, Fresh Juice Development, LLC, Grab N Go Juice, LLC, Juice To Go, LLC and LA Juice Company, LLC - all machinery, equipment,
computer hardware (including point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, all
marketable inventory and all goodwill associated with the stores for a purchase price of $6,600,030 plus payment of $30,000 for
cash on hand at each of the stores. Brea Juice Company, LLC, Fresh Juice Development, LLC, Grab N Go Juice, LLC, Juice To Go, LLC
and LA Juice Company, LLC, agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection
with entering into the transaction.
July Disposal 2
On July 28, 2015, the Company
completed the refranchising of a group of Company-owned stores located in Northern and Southern California as part of its refranchising
initiative. In connection with the refranchising transaction, the Company transferred to Vitaligent, LLC through its two wholly
owned subsidiaries, Vitaligent-East Bay, LLC and Vitaligent-NorCal, LLC, all machinery, equipment, computer hardware (including
point of sale equipment), furniture, fixtures, tools, signs, other tangible personal property, cash on hand at each of the stores,
all marketable inventory and all goodwill associated with the stores for a purchase price of $25,000,000. The purchase price comprises
a $23,000,000 cash payment and a promissory note for $2,000,000 that matures on February 1, 2021. The promissory note bears basic
interest at a rate of 3% per annum, plus payment-in-kind interest at a rate of 5.5% per annum. The payment-in-kind interest compounds
quarterly beginning October 28, 2015. In addition to a $50,000 escrow account at closing for store repairs/upgrades, there is a
reduction in gain for contingent payables of $694,000 for designated repairs and fixed asset additions. Vitaligent-East Bay, LLC
and Vitaligent-NorCal, LLC agreed to enter into the Company’s standard franchise agreement with a ten-year term in connection
with entering into the transaction.
Other Disposals
In addition to the
transactions mentioned above, the Company entered into multiple individually immaterial agreements and refranchised a small
group of stores located in Southern California and in the San Francisco Bay Area during the 13 week periods ended March 31,
2015 and June 30, 2015. In connection with the refranchising transactions, the Company received aggregate proceeds of
$2,412,000 and the purchasers entered into the Company’s standard franchise agreements with ten-year terms in
connection with entering into the transactions.
The unaudited pro
forma condensed consolidated financial statements were prepared in accordance with GAAP and pursuant to U.S. Securities
and Exchange Commission Regulation S-X Article 11, and present the pro forma financial position and results of operations of
the Company based upon the historical information after giving effect to the disposal and adjustments described in the notes
to the unaudited pro forma condensed consolidated financial statements. The unaudited pro forma condensed consolidated
balance sheet is presented as if the refranchising had occurred on June 30, 2015, and the unaudited pro forma condensed
consolidated statement of operations for the 26 week period ended June 30, 2015 is presented as if the disposal had occurred
on January 1, 2014 and carried forward through the 26 week period ended on June 30, 2015. As a result, pro forma
adjustments for refranchising of the small group of stores completed during the 26 week period ended June 30, 2015 were
reflected in the unaudited pro forma condensed consolidated statement of operations only.
The unaudited pro forma condensed consolidated financial
information is presented for informational purposes only and is not indicative of the Company’s financial results or financial
position as if the transactions reflected herein had occurred, or been in effect during the pro forma periods. This unaudited
pro forma condensed consolidated financial information should not be viewed as indicative of the Company’s expected financial
results for future periods.
| 3. | Adjustments to Unaudited Pro Forma Condensed Consolidated
Statement of Operations |
A - Reflects the pro forma adjustments for the revenue
during the 26 week period ended June 30, 2015 from the stores sold to franchise partners.
B - Reflects the pro forma adjustments for estimated
royalty income that would have been earned had the stores been owned by franchisees for the 26 week period ended June 30, 2015.
C - Reflects the pro forma adjustments for the expenses
related to the stores sold to franchise partners.
D - Reflects the pro forma adjustments to remove
the effect of the gain on refranchising the small group of stores during the 26 week period ended June 30, 2015.
E - Reflects the pro forma adjustments to eliminate
the 12% noncontrolling interest in JJSC, since the owner of the noncontrolling interest is acquiring the remaining interest on
the JJSC stores.
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